Thoughts on Generating Business Momentum

A flywheel illustrating business momentum
A Flywheel

Business momentum is that point in the timeline of your business when things take off. Sometimes called reaching the critical mass, when this happens, the business takes on a life of its own. Customers show up unannounced and the hustle for each new customer seems like something in the past. Endorsements and testimonials abound, press finds you, and people just seem to throw opportunities at you.

Until this happens, you are doing the daily grunt work, wondering why things are not working out as you expected. Is it really worth posting that social media message today, you wonder, when nothing much has happened the last 100 times you did this. Shall you really make that one extra phone call now, or can it wait till tomorrow? After all, how much of a difference a day will make!

The Flywheel Metaphor

In Good to Great, Jim Collins writes

Picture a huge, heavy flywheel—a massive metal disk mounted horizontally on an axle, about 30 feet in diameter, 2 feet thick, and weighing about 5,000 pounds. Now imagine that your task is to get the flywheel rotating on the axle as fast and long as possible. Pushing with great effort, you get the flywheel to inch forward, moving almost imperceptibly at first. You keep pushing and, after two or three hours of persistent effort, you get the flywheel to complete one entire turn. You keep pushing, and the flywheel begins to move a bit faster, and with continued great effort, you move it around a second rotation. You keep pushing in a consistent direction. Three turns … four … five … six … the flywheel builds up speed … seven … eight … you keep pushing … nine … ten … it builds momentum … eleven … twelve … moving faster with each turn … twenty … thirty … fifty … a hundred. 

Then, at some point—breakthrough! The momentum of the thing kicks in in your favor, hurling the flywheel forward, turn after turn … whoosh! … its own heavy weight working for you. You’re pushing no harder than during the first rotation, but the flywheel goes faster and faster. Each turn of the flywheel builds upon work done earlier, compounding your investment of effort. A thousand times faster, then ten thousand, then a hundred thousand. The huge heavy disk flies forward, with almost unstoppable momentum. 


And later,

Now suppose someone came along and asked, “What was the one big push that caused this thing to go so fast?” You wouldn’t be able to answer; it’s just a nonsensical question. Was it the first push? The second? The fifth? The hundredth? No! It was all of them added together in an overall accumulation of effort applied in a consistent direction. Some pushes may have been bigger than others, but any single heave—no matter how large—reflects a small fraction of the entire cumulative effect upon the flywheel. …

In The Compound Effect, Darren Hardy delivers the message that the little everyday decisions will lead you to great success, or to disaster. Small things are easy to do, but at the same time, they are easy not to do. How you choose makes the difference. Just as positive pushes compound over time, inaction also compounds over time leading to ruin.

The Positive Feedback Loop

J. C. Larreche describes the reason why many high growing companies succeed boils down to the understanding of how to generate and maintain momentum in business. A business with momentum, they find, creates more 80% more shareholder value while spending less on marketing and advertising expenses. In The Momentum Effect, he lays out the framework that any company can use and create, and maintain this momentum and grow rapidly.

The goal for any business is to achieve micro-goals that feed back into the process to make the large goals more achievable. By creating conditions that feed on themselves, the business can accelerate forward with increasing momentum.

When Jeff Bezos was starting Amazon, he drew the following positive feedback loop on a piece of napkin (where else!)

The Amazon Flywheel

Better customer experience drives more traffic that attracts more sellers to the platform which in turn increases the selection of the products available thereby improving customer experience further and so it continues on

Meanwhile, the expanding scope and scale of the business lowers the cost structure so Amazon can lower the prices and make customers happier which attracts more customers …

How to Build Business Momentum in Your Business?

Momentum depends on 3 primary things

  1. Consistency of Effort
  2. Intensity of Effort
  3. Direction

The harder you push, and the more consistent you are, it will be easier and faster to generate momentum provided all the effort is focused in one direction.

Sounds simple enough.

Therefore, to generate the momentum in your business, you need to know where you want to focus your efforts, what effort needs to be made, and how much.

For example, in a web delivered service business like mine, where people value my expertise, it is important for me to consistently write thought leadership pieces that showcases my expertise. I also need to provide practical ideas and advice that help investors with their most pressing questions. And I have to do this regularly in all the venues where my audience congregate.

So I write on my website. I write on Medium. I write on Seeking Alpha. I use social media. I do email marketing. I do landing page optimization. I worry about targeting, traffic, retention, conversion rates and client satisfaction.

Most businesses have a similar flywheel. If you are a business owner, you understand your goals and you know the activities that you need to do to reach these goals. This is a requirement and doing this well does not necessarily give you a competitive edge.

The trick to achieving business momentum, I have found by experience, is to emphasize speed and amplification.

What do I mean by Speed and Amplification?

Let’s say you use content marketing as a channel to get traffic, increase retention, and help potential customers through their customer journey and generate sales revenue.

To make this channel to create momentum and compound results for you, you need to focus on creating as much content as you can that supports your message, and then distributing them far and wide so you can reach the maximum audience. Do you think a partnership with other content creators will help? Do it. Do you think writing an exclusive column on other website will put you in front of a new audience? Do it.

The key is to do things fast and keep on doing them. Momentum equals mass times velocity. The more effort you put in, and faster you move, the quicker you will be able to generate the business momentum and sustain it. Amplification will add to the mass, you bring the speed.

Shailesh Kumar

I am an author, investor and entrepreneur. I have published several investment books and founded Value Stock Guide. I have been featured in NY Times, Forbes, CNBC and other places around the web. I grew up in India and attended the Indian Institute of Technology where I studied Electrical Engineering. Later I completed my MBA from University of Michigan Business School. I live in Ann Arbor, Michigan with my beautiful wife and two great children. Our orange tabby cat rounds off our family. I love to read, write, run, hike, backpack, play, travel and help others be awesome.